Rental Inflation Out of Control in Tokyo, Hong Kong, and other urban centers

As we progress more into the 21st century, the availability of housing and accommodation is becoming steeper in highly urbanized zones. Megacities such as New York, Hong Kong, and Tokyo are feeling the pressure. Once the booming centers of the early 1990s and 2000s, they have now become concrete jungles with a skyscraper popping up seemingly every day to cope with the high demand for housing and businesses premises. Even though most of the business is moving online companies still require physical spaces to locate their physical address and want to be associated with such metropolitans with an established reputation.

Henceforth, the problem for municipal planning departments and construction companies is how to provide affordable housing to a myriad of clients. Most organizations are cashing in on these challenges by charging exorbitant rent prices from prospective tenants. Therefore, making the transactions untenable and driving significant business out of the megacities to more affordable off-site locations. However, the authorities have realized the trend and are trying to incorporate numerous strategies to cope with the issue.

Offering subsidized housing through tax cuts

Through identification of prospective investors within the megacities, urban planning governments are implementing policies that provide subsidized housing rental prices. They have introduced tax levied on the investors to minimize their debt load and allow the various investors to set up shop within the city boundaries. Additionally, proposed changes in property tax policies in cities such as New York will ease the pressure on landlords and allow them also to encourage business to continue rather than discourage prospective investors.

Industrial parks offering better rental prices

Startups in cities such as hong kong are taking advantage of industrial packs built to accommodate them at affordable rates. The industrial parks are innovation hubs, and most tech hubs are opting to engage in these areas set aside by urban planning development to accommodate companies and build harmonious working relationships that tend to pull instead of push away important commerce transactions.


Metropolitans are adopting the practice of upscaling suburbs surrounding the megacities to accommodate more business. Even though the process has received criticism at times for segregation, it is a formal way of increasing rental places at reasonably affordable costs. Because developers acquire the land at somewhat lower prices, they also offer to the apartments at similarly reduced rates. Besides, its somehow a win-win situation because the displaced neighborhoods are often well compensated for resettlement elsewhere. Nonetheless, it is not an advisable tactic because some developers take advantage of low-income houses and offer peanuts in exchange for lucrative deals. Nevertheless, it is another aspect that highly urbanized areas are looking into to provide more business spaces.

Consequently, the increase in population is a continuous event, and demand in housing will continue to soar. The world is becoming tougher to live in with competition for resources at all time high. It’s not assured that the tactics mentioned above might work because unscrupulous developers want to earn that extra dollar. Hence, unless policies change and regulations stiffen affordable housing in urban areas is still going to pose a challenge.